Salesforce (CRM) saw its loss widen to $37.31 million, or $0.05 a share for the quarter ended Oct. 31, 2016. In the previous year period, the company reported a loss of $25.16 million, or $0.04 a share. On the other hand, adjusted net income for the quarter stood at $170.94 million, or $0.24 a share compared with $140.52 million or $0.21 a share, a year ago. Revenue during the quarter grew 25.28 percent to $2,144.78 million from $1,711.97 million in the previous year period. Gross margin for the quarter contracted 255 basis points over the previous year period to 72.70 percent. Total expenses were 99.86 percent of quarterly revenues, up from 97.46 percent for the same period last year. That has resulted in a contraction of 240 basis points in operating margin to 0.14 percent.
Operating income for the quarter was $3.04 million, compared with $43.43 million in the previous year period.
However, the adjusted operating income for the quarter stood at $272.55 million compared to $227.01 million in the prior year period. At the same time, adjusted operating margin contracted 55 basis points in the quarter to 12.71 percent from 13.26 percent in the last year period.
"Salesforce delivered an exceptional quarter with year-over-year revenue growth of 25% in dollars and 27% in constant currency," said Marc Benioff, chairman and chief executive officer, Salesforce. "I’m delighted to announce that we expect to deliver our first $10 billion year during our fiscal year 2018, which puts us well on the path to reach $20 billion faster than any other enterprise software company."
For fiscal year 2017, Salesforce forecasts revenue to be in the range of $8,365 million to $8,375 million. The company expects diluted earnings per share to be in the range of $0.24 to $0.25. It company expects diluted earnings per share to be in the range of $0.97 to $0.98 on adjusted basis.
For the fourth-quarter 2017, Salesforce forecasts revenue to be in the range of $2,267 million to $2,277 million. The company expects diluted loss per share to be in the range of $0.10 to $0.09. On an adjusted basis, the company expects diluted earnings per share to be in the range of $0.24 to $0.25.
Revenue for the company’s full fiscal year 2018 is projected to be approximately $10.1 billion to $10.15 billion.
Operating cash flow improves
Salesforce has generated cash of $1,456.05 million from operating activities during the nine month period, up 21.15 percent or $254.18 million, when compared with the last year period.
The company has spent $2,186.49 million cash to meet investing activities during the nine month period as against cash outgo of $882.65 million in the last year period.
Cash flow from financing activities was $737.66 million for the nine month period as against cash outgo of $1.01 million in the last year period.
Cash and cash equivalents stood at $1,145.74 million as on Oct. 31, 2016, down 6.34 percent or $77.58 million from $1,223.32 million on Oct. 31, 2015.
Working capital remains negative
Working capital of Salesforce was negative $1,973.98 million on Oct. 31, 2016 compared with negative $1,038.20 million on Oct. 31, 2015. Current ratio was at 0.60 as on Oct. 31, 2016, down from 0.74 on Oct. 31, 2015.
Days sales outstanding went down to 50 days for the quarter compared with 57 days for the same period last year.
Debt increases substantially
Salesforce has witnessed an increase in total debt over the last one year. It stood at $1,804.37 million as on Oct. 31, 2016, up 40.12 percent or $516.61 million from $1,287.76 million on Oct. 31, 2015. Salesforce Com has witnessed an increase in long-term debt over the last one year. It stood at $1,804.37 million as on Oct. 31, 2016, up 40.12 percent or $516.61 million from $1,287.76 million on Oct. 31, 2015. Total debt was 12.54 percent of total assets as on Oct. 31, 2016, compared with 11.80 percent on Oct. 31, 2015. Debt to equity ratio was almost stable at 0.27 as on Oct. 31, 2016, when compared with the last year. Interest coverage ratio deteriorated to 0.14 for the quarter from 2.38 for the same period last year. Disclaimer: Please note that this is an auto-generated article. IRIS does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. IRIS especially states that it has no financial liability whatsoever to any user on account of the use of information provided on its website. For queries contact: editor@irisindia.net
